The great wealth transfer has already begun, but it generally refers to a shift in wealth in America over the next two decades. Essentially, Baby Boomers have roughly $84 trillion in assets. This is the greatest amount of assets ever to be passed down to the next generation. Most of the recipients will be in Generation X or they may be Millennials. Either way, they are expected to inherit around $72 trillion.
Transferring money – along with tangible assets – can get very complicated. It requires extensive estate planning and it is likely to lead to disputes. That’s why all involved need to carefully consider their legal options.
Where will the other $12 trillion go?
As you can see above, experts predict that only $72 trillion out of the total $84 trillion will be passed down to the next generations. So what happens to the other $12 trillion?
Some reports claim that this money is going to be given to charity. Certainly, many wealthy individuals have set up plans to leave their money to charity, sometimes even refusing to leave it to their own descendants.
It is also worth noting that the total amount of money is going to be impacted by medical bills. Many people will lose a significant chunk of their life savings to end-of-life care. This means that some of the Great Wealth Transfer will just be Baby Boomers transferring their money to healthcare companies, rather than their own descendants.
Legal steps to take
There are many different ways to transfer assets, from wills to trusts to payable-on-death accounts. Every family will have different needs and priorities, so it is simply important for those working through this process to know what legal steps will help in their unique case.
